Property: The hardest pounds 90 that you're ever likely to save

Money used to be a good enough reason to struggle through your own conveyancing, but not any more. By Richard Phillips
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The Independent Online
Buying a home is expensive and near the top of the list of conspicuous costs - conspicuous wastes of money, some would say - comes conveyancing. As well as estate agents' and surveyors' fees, and stamp duty if the property costs more than pounds 60,250, there is the little matter of conveyancing to pay for - and it will be a bill that's unlikely to charm by its modesty.

So what are you paying for and why is it so important?

Conveyancing is the legal act of transferring the right of ownership - the title to the property - from one person to another. As such, the solicitor acting for the buyer will check that the property really does belong to the person who is selling it; that there are no disputes outstanding on it; and that any covenants attached to it are not unduly restrictive. If, for example, the seller insists the new owner cannot sub-let rooms, the buyer's solicitor can demand this covenant be removed.

There was a vogue in the Seventies and Eighties for some brave souls to handle their own conveyancing. At that time, it could save a buyer a substantial amount of money - conveyancing fees then were set to a fixed scale, 1 per cent of the value of the property. Since deregulation, however, fees have plummeted and now average around 0.2 per cent of the value of a property - or something like pounds 300, say, for a pounds 150,000 house.

Any surviving benefit in going it alone is now almost entirely mitigated by the lending bank, which will employ its own solicitor to double check your work and then pass on the cost to you. Of that pounds 300, you may be able to save pounds 90, if you are lucky. Considering the work involved, you have to ask yourself whether it's worth it.

And make no mistake, a good job will require dedicated evenings swotting up. If you remain determined, the bible of the DIY fraternity is Michael Joseph's The Conveyancing Fraud. It's well worth a read even if you have every intention of hiring a professional to do the work; it will leave you far better placed to ask your solicitor pertinent and relevant questions.

But if the financial benefits of DIY conveyancing have largely evaporated, it does still have its advantages. John Goold, who handled his own legal work for a property he bought on the outskirts of London several years ago, points out that the exercise gave him a fine knowledge of the legal technicalities involved in buying and selling a home. It also illustrated to him the futility of much of the jargon in which the transfer of a property is couched. "It was a revelation. The replies from the other side's solicitors are quite meaningless on closer examination," he says.

Be prepared for this. Standard enquiries, such as who owns the boundary fences, can elicit replies like, "It is believed the boundary fences belong to the property, but no assurance is given, and the purchaser should make his own enquiry." If you have handed the conveyancing to a solicitor, you may never see these answers - and fail to appreciate the general pointlessness of much of the work being undertaken.

You may also begin to wonder why a document it took you an evening to prepare requires three or four weeks for the vendor's solicitor to answer.

The overwhelming red tape that engulfs property transaction - and which is, to a large extent, unique to England and Wales - will drive you mad. But while there is little you can do to escape the process, being aware of how conveyancing works, even if you are using a solicitor, can give you an edge in keeping the whole process on track.

As well as the conveyancing itself, your solicitor will handle other tasks. The title of the property is usually checked through a Land Registry search - almost 90 per cent of properties are now registered on its database. However, compulsory registration has applied throughout the country for less than 10 years so there is still lots of unregistered property that requires investigation of the seller's title.

The solicitor will also check there are no undisclosed charges or mortgages against the property.

Finally, there will be local authority searches, to ensure that the property has consent for residential use, and whether or not there are any planning applications on the building or surrounding land.

However, searches are only good for a few weeks after they were made. It is wise to ask your solicitors to make further enquiries (or to do so yourself), for example to railway companies, to see if there is any change of use planned for existing lines nearby. A swathe of planning blight plagued properties across London over the future route of the Channel Tunnel rail link, but a local authority search would have failed to reveal this information.

Finally, how to choose a solicitor. For the reason above, a local firm is probably best - rumours of plans such as the rail link can emerge months before detailed proposals and only a local ear will hear them.

Quotes can vary widely - differences of as much as 20 per cent are common. It is up to you judgement which firm to choose, but unless the property is going to be relatively straightforward to deal with (and that is hard to tell) it is best not to scrimp. Personal recommendation is an invaluable guide: talk to friends who have used a solicitor in your neighbourhood and ask if they felt they got good service. That, after all, is what you need.

"BUYING A HOME HERE - YOU'D THINK YOU WERE TRYING FOR ADOPTION"

Our cousins north of the border pride themselves on cultural and judicial matters that distinguish them from the Sassenach heathen. One such is buying and selling a home. Talk to a Scot who is making the move back to the home country, and his eyes light up.

With a smug grin, he will delight in telling you how painless it has all been - unlike the hell when they first bought a home in England. "All that to-ing and fro-ing between solicitors, and estate agents, and other buyers. Why, it took us just three weeks, from start to finish, to buy our home in Glasgow. Buying a home here, you'd think you were trying for adoption."

It is a whinge well past its sell-by-date, but here we go again: the property market of England and Wales is in a mess, has been in a mess, and will continue to be a mess, for buyers, sellers, and agents, if the entire process remains as it is.

Recent research shows that the average time - remember, the average time - to move home, is 12 weeks in south-east England, 19 weeks in the Midlands, and a ridiculous 23 weeks in the Northwest. Heaven help those who wait longer than the average. And you wonder why moving home is the second most stressful life event after a bereavement?

The main reason for the lengthy gestation, is the chain. Chains are notorious, and there seems little that can be done to avoid them.

Reform of the property market does occasionally creep on to the political agenda, but there are precious few votes in it, and given the vested interest of solicitors, estate agents,et al, little momentum to change the status quo.

The Law Society, some years ago, streamlined the procedure for conveyancing, which helped speed matters up. But further reforms are still needed.

In Scotland, chains do not happen. This is due to one main difference: houses there are bought and sold by tender. When you put your house on the market, interested buyers put in their bids, the highest bid is accepted - and as soon as that happens, it becomes a legally-binding contract. In England, people can delay until the last minute - leading to gazumping.

It is not unheard of for Scottish properties to be sold within a week of going on the market. Sellers give themselves enough time to buy their new home by stating an entry date, when the new owner can move in.

Scotland is also unusual in that sales are handled by solicitors, who have a dual role as agent to the seller, giving them a complete picture of their client's affairs.

The Scottish system has its drawbacks: bridging finance may be required, if a seller has to move into a new home, without having sold the previous home. Likewise, some Scots find themselves living in temporary accommodation in between moves.

But a balance between the two systems could be achieved.

Buyers and sellers should be given the choice of stipulating whether an offer becomes binding the moment it is accepted - and not when contracts are exchanged.

On the financing front, there is a strong case for lenders to provide more flexible, and far cheaper bridging finance.

And arguably, solicitors could be given an enhanced, not a reduced role in the process.

This week sees a group of conveyancing solicitors gather to try and hammer out some ideas on how matters may be improved. Any change on the present dire condition could only be for the better.

RP

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